Fees tanking.

Brexit is the last thing investment banks needed.

Bloomberg News reports that market volatility triggered by U.K. voters’ surprise decision to withdraw from the European Union herald even harder times for securities firms already struggling to improve earnings.

While some desks made money in the initial turmoil, continued market volatility in the months ahead poses a threat to trading profits. And companies that hire banks to advise on takeovers and raise money face years of uncertainty as Britain negotiates new international ties.

Analysts on both sides of the Atlantic cut earnings estimates for the biggest investment banks on the expectation that securities sales and major deals will be thwarted by economic and political uncertainty and currency swings. Fees from that business are likely to “tank,” dropping more than 30% this year at European banks, Sanford C. Bernstein analyst Chirantan Barua wrote. Analysts at Citigroup and JPMorgan estimated lower underwriting volumes in the U.K. and Europe.

To access the complete Bloomberg News article hit the link below:

Investment Banks Face Hit From Brexit-Era Turmoil, Few Deals

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